General Motors (GM, Financial) has surpassed Tesla in U.S. battery production capacity, according to BloombergNEF. GM achieved this milestone during its production ramp-up phase. The Ultium Cells plant in Nashville, Tennessee, a $2.3 billion investment, is currently operating at partial capacity, with a design capacity to produce 5,000 battery cells per hour continuously.
The Ohio-based Lordstown plant, a joint venture with LG Energy Solution, has already reached mass production. These facilities supply battery systems for popular models like the Chevrolet Equinox EV and Cadillac LYRIQ. Analysts suggest that GM's pricing strategy, particularly for the Equinox EV starting at $34,995, is crucial for market acceptance.
At a recent BloombergNEF summit, Kurt Kelty, GM's VP of Battery and Energy, revealed that GM reduced battery costs by $60 per kWh in 2023 through material innovation and process optimization. By 2025, further cost reductions of $30 per kWh are anticipated, potentially lowering costs to $100 per kWh, a 50% decrease from 2023, and possibly below Tesla's costs. Currently, the industry average in China is $94 per kWh.
To bridge this gap, GM plans to shift from current battery modules to prismatic cells. In collaboration with Samsung SDI, GM is building a $3.5 billion plant in New Carlisle, Indiana, to produce these cells. Although the plant's launch has been delayed to 2027, GM's electrification strategy remains robust despite potential political and regulatory hurdles.
